Getting to grips with how to use money and understanding basic finances can start as soon as children reach school age. Handling money forms a key part of the numeracy curriculum and many children face stumbling blocks in this area as they have had little exposure to different denominations, paying for goods and counting change.
Recent research by Legal & General Investments found that children begin to have financial awareness from an early age. Their poll of almost 200 six year-olds found that 27% believed that money ‘makes the world go round’ and that they will pay under £10,000 for their first home. The survey also found that the average six-year-old expects their future annual salary to be £100 a year.
Simon Ellis, Managing Director of Legal & General Investments, said: ‘Whilst our tongue in cheek research gives insight into the charming naivety of children, it is important to remember that financing your child’s future is a serious matter.’
‘Teaching future generations to be ‘money wise’ should be a priority for all parents.’
Below are a few ways you can teach children about money as they move through their school life:
Foundation Stage (3-5):
Children can create their own shops at home and at school using plastic money to pay for the goods they want. Parents can get involved in the role play situation and ask for a certain amount such as 2p, and offer 1p in change to begin to familiarise children with these concepts.
Key Stage 1 (5-7):
At this stage children could be given a small amount of money to make a purchase on your weekly shop, and you could discuss what change will be given from different denominations such as 10p, 50p and £1. Children could also collect their spare change in a piggy bank and count up their savings each week.
Key Stage 2 (7-11):
Children at this stage could be given a weekly amount of pocket money that they will need to budget for cinema trips, stationery and other expenses. They could also start to use small notes to pay for goods and calculate change.